Radio Address to the Nation on Small Business
May 14, 1983 My fellow Americans:
This is the last day of Small Business Week, so I'd like to mark the occasion by speaking about the importance of entrepreneurs and how we're trying to help them.
When you think about it, every week should be Small Business Week, because America is small business. Small firms account for nearly half our jobs; they create some 60 percent of new jobs; and they're on the cutting edge of innovation, providing products and ideas for the future. Everything from ballpoint pens to FM-radios, automatic transmissions and helicopters was conceived in the minds of entrepreneurs -- men and women who had the spirit to dream impossible dreams, take great risks, and work long hours to make their dreams come true.
In his book, ``Wealth And Poverty,'' George Gilder wrote, ``. . . most successful entrepreneurs contribute far more to society than they ever recover. And most of them win no riches at all. They are the heroes of economic life. And those who begrudge them their rewards demonstrate a failure to understand their role and their promise.'' Well, he's right. Too often, entrepreneurs are forgotten heroes. We rarely hear about them. But look into the heart of America, and you'll see them. They're the owners of that store down the street, the faithfuls who support our churches, schools, and communities, the brave people everywhere who produce our goods, feed a hungry world, and keep our homes and families warm while they invest in the future to build a better America.
That word ``invest'' helps explain why entrepreneurs are a special breed. When small business people invest their money, they have no guarantee of a profit. They're motivated by self-interest. But that alone won't do the trick. Success comes when they can anticipate and deliver what you, the consumer, wants, and do it in a way that satisfies you. As Gilder points out, entrepreneurs intuitively understand one of the world's best kept secrets: Capitalism begins with giving. And capitalism works best and creates the greatest wealth and human progress for all when it follows the teachings of scripture: Give and you will be given unto . . . search and you will find . . . cast your bread upon the waters and it will return to you manyfold.
In the Parable of the Talents, the man who invests and multiplies his money is praised. But the rich who horde their wealth are rebuked in scripture. True wealth is not measured in things like money or oil, but in the treasures of the mind and spirit. Oil was worthless until entrepreneurs with ideas and the freedom and faith to take risks managed to locate it, extract it, and put it to work for humanity. We can find more oil and we can develop abundant supplies of new forms of energy if we encourage risktaking by thousands and thousands of entrepreneurs, not rely on government to horde, ration, and control. The whole idea is to trust the people. Countries that don't, like the U.S.S.R. and Cuba, will never prosper.
Entrepreneurs have always been leaders in America. They led the rebellion against excessive taxation and regulation. They and their offspring pushed back the frontier, transforming the wilderness into a land of plenty. Their knowledge and contributions have sustained us in wartime, brought us out of recessions, carried our astronauts to the Moon, and led American industry to new frontiers of high technology.
We came to Washington confident that this small business spirit could make America well and get our economy moving again. Well, it's working. And we want to keep on using that special principle of giving by putting America's destiny back into the people's hands, providing you new incentives to save, invest, and take risks, so more wealth will be created at every level of our society.
We know small business is ready. That group fared better during the recent recession, laid off less workers than big business, and will recover faster. Over the last 2 years, you heard about the high rate of small business failures. You heard about it over and over again. What you didn't hear very often was that in 1981 a record 580,000 new businesses were formed. And 560,000 new enterprises were begun in 1982. They're the seeds of lasting recovery.
I think America's witnessing a renaissance in enterprise, and it's being nurtured by victories we've won -- for example, reducing the regulatory burden; knocking down the rate of inflation by more than two-thirds; cutting more than in half the record 21\1/2\- percent prime interest rate we inherited; passing a Small Business Innovation Development Act to direct millions of dollars in research funds to high-tech firms; passing the Prompt Payments Act to assure that small businesses dealing with the Federal Government get paid promptly; and, most important, providing solid incentives for new investment and risk-taking by cutting personal tax rates, shortening depreciating schedules, and sharply reducing estate taxes on family-owned businesses and farms.
At least 85 percent of the 13 million small firms in America pay their taxes by personal rates, not by corporate rates. These firms will provide most of the new jobs to bring down unemployment. Any action that tampers with the third year of the tax cut or the indexing provision, which protects you from being pushed by inflation into higher tax brackets, would harm small business and send unemployment up, not down. That's why I must and I will veto any attack on the tax incentives. They belong to you, the people. They're not the government's to take away.
If the Congress wants to help us spur small business growth and jobs in depressed regions, it should pass our enterprise zones proposal. This could provide genuine opportunity for those in need. So, we hope there'll be no further delay.
Governments don't reduce deficits by raising taxes on the people. Governments reduce deficits by controlling spending and stimulating new wealth, wealth from investments of brave people with hope for the future, trust in their fellow man, and faith in God.
Till next week, thanks for listening, and God bless you.
Note: The President spoke at 12:06 p.m. from Camp David, Md.